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Picture of Beretta682E
posted
30 year fixed mortgage over 5 percent

Average home price $511k

A year back 3.3 percent and $408k

The math for be a home owner for young Americans is getting ugly.

Mortgage today to buy average house $2200 versus $1400 last year.

Mike


Every man has a right to his opinion, but no man has a right to be wrong in his facts.

Bernard Baruch
 
Posts: 13108 | Location: Cocoa Beach, Florida | Registered: 22 July 2010Reply With Quote
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I don't know how some of these young folks can make it. Hell, everything I have is paid for + I sometimes wonder if I can.


Never mistake motion for action.
 
Posts: 17353 | Location: Austin, Texas | Registered: 11 March 2013Reply With Quote
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You should have been around in the early 80s my first home loan was 13.5

Some people took 18% loans out.
 
Posts: 18086 | Location: wis | Registered: 21 April 2001Reply With Quote
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Picture of Labman
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I remember those days, but my mortgage was only 11%.


Tom Z

NRA Life Member
 
Posts: 2156 | Location: Pennsylvania | Registered: 07 January 2005Reply With Quote
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I think we're at a fork in the road, but which way things will go is the question.
A permanent rise in incomes and asset prices, or a deflationary drop in both incomes and asset prices?
The federal debt looms over all, if interest rates go back to historical norms, taxes have to change.
And, since the Social Security Trust Fund is full of federal debt, taxes have to change anyway as those assets are liquidated to fund the shortfall in revenues vs payments.

In 1980, I bought a pickup truck with a 19.75% interest rate, friend bought a house at 14%. I bought an inexpensive rental house, assumed an existing mortgage and rented it out for about the same money as the mortgage interest. It was kind of a savings account in that regard, but sold it two years later after moving 700 miles.


TomP

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Posts: 13418 | Location: Moreno Valley CA USA | Registered: 20 November 2000Reply With Quote
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These are certainly realities; sad but true.

I just put an offer on a house in Northern Utah for my son- asking price was $235k, we offered $240k and agreed to close in 3 weeks. Fortunately, it was accepted. It's a 2 bedroom 1 bath condo. A week or so later, a similar condo (70-80 more square feet) came on the market for $260k. It's already under contract. A few days ago another one came available, similar in size (a bit bigger) for $284k. It has not (yet) went under contract.

My son has a good job and is very frugal with money (zero debt) and he will still be a bit stretched. His friend is going to rent one of the rooms from him as well.

Building lots in my area have double in the past two years. I am seeing homes pushing the $400 per square foot range! The madness continues and people want real estate.

The interest rates were sky high years back but what was the cost of the property compared with the annual salary of the buyer? I would guess (I certainly could be wrong) was probably double the annual salary. Now, although interest rates are much lower, the cost of a house is many times over the average salary. In 1994 myself and my wife bought our first house for $63,000. It was a small 3 bedroom 1 bath house, around 1100 square feet. We were poor students, working full time jobs with a combined annual salary around $30,000. The interest rate on our loan was 7.5%. Compared to now, the cost of this house was a bargain!

Strange times
 
Posts: 2373 | Location: Utah | Registered: 23 February 2011Reply With Quote
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It is all going to the communist plan. Only the oligarch's own property and everyone else rents.
 
Posts: 3168 | Location: SC,USA | Registered: 07 March 2002Reply With Quote
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quote:
Originally posted by p dog shooter:
You should have been around in the early 80s my first home loan was 13.5

Some people took 18% loans out.


I had a Jimmy Carter mortgage over 15%.


NRA Patron member
 
Posts: 2533 | Location: Minnesota | Registered: 08 December 2006Reply With Quote
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Picture of NormanConquest
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When I bought my property in the early 70s I built a small cabin to live in + then started on the big house doing it money out of pocket. It took a while but I now have a home valued at $350K on land worth 3 times that much that is paid for (as long as I can pay the ever increasing taxes).


Never mistake motion for action.
 
Posts: 17353 | Location: Austin, Texas | Registered: 11 March 2013Reply With Quote
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quote:
When I bought my property in the early 70s I built a small cabin to live in + then started on the big house doing it money out of pocket


That was/is a great idea. I built a cabin several years back like that. It took 4 years to complete but was well worth it. My neighbor watched me build it and then ended up buying it from me. I wish I still had it!
 
Posts: 2373 | Location: Utah | Registered: 23 February 2011Reply With Quote
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Picture of Todd Williams
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As a custom home builder in North Texas, we've seen prices increase faster than we can keep up with.

A year and a half ago, we were a fixed price builder and a basic home could be built for roughly $135 per sq. ft, HVAC area, as long as covered porches and garages were typically sized. Today, that same home is $210 per sq. ft.

Lumber doubled between November and January. It appears to be on the way back down now however but we don't see the commodities price trends at the lumber yard for approximately 90 days.

Anyway, today, we are still not a Cost +20% builder like most companies, but rather a fixed price for our company fees (profit and overhead), but every hard cost line item is priced as an allowance based on "Today's price". If all the line items come in over the total allowance budget, the customer is responsible for paying. This after we lost more than $50K on each of 3 homes under our fixed price contracts that were written prior to the covid related price increases. When I say we lost $50K each, I don't mean we made $50K less than expected. I mean we lost every penny of our projected profit, PLUS an additional $50K out of our pockets were necessary to finish the homes!

Both of the primary banks we deal with, now insist that the customer's loan has a 10% contingency line to cover overages as they got tired, not just with our customers, but all their builder's customers, running out of money in construction and coming back for more funds before the permanent take out.

I'd say from our sales meetings and closing rates currently, we are finally seeing pushback in the market. We used to close 8 out of 10 customers that came to us. Today we are closing about 4 of 10. Several folks have stated they are just waiting to see what happens.
 
Posts: 8262 | Registered: 09 January 2011Reply With Quote
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Here is something to think about.

50 years ago there was a shortage of rental properties here.

On a plot of land 100x100 foot, one could build a villa for AED100,000.

And rent it for a year for that amount.

Today one is lucky to get his capital expenditure on real estate in less than 30 years.

Of course the value goes up.


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Posts: 61297 | Location: Dubai, UAE | Registered: 08 January 1998Reply With Quote
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quote:
A year and a half ago, we were a fixed price builder and a basic home could be built for roughly $135 per sq. ft, HVAC area, as long as covered porches and garages were typically sized. Today, that same home is $210 per sq. ft.


Todd: That is very good, compared to what we have here. Please come to Utah Smiler
 
Posts: 2373 | Location: Utah | Registered: 23 February 2011Reply With Quote
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Picture of Bill/Oregon
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And ouch, those Texas property taxes. I've been looking hard in recent weeks ...


There is hope, even when your brain tells you there isn’t.
– John Green, author
 
Posts: 14865 | Location: Sweetwater, TX | Registered: 03 June 2000Reply With Quote
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Bill/Oregon I have found the tax burden worse in New Mexico than Texas. Property taxes are fairly comparable, but no state income tax in Texas. Texas urges people to work. New Mexico teaches people how to hold out their hand.
 
Posts: 591 | Location: New Mexico | Registered: 03 February 2013Reply With Quote
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When I retired and wanted out of the northeast I looked at Texas, NM, Montana, etc. All were much more expensive and offered much less opportunity that where I ended up. While no place is absolutely perfect, nine years later I am still very happy with my decision.

I think with the way the economy is right now, things are probably much worse in such respects. I am surprised people are willing to pay basically double the price- of less than 2 years ago to build, move, etc but they are. They're also taking expensive vacations. Crazy times.


~Ann





 
Posts: 17614 | Location: The LOST Nation | Registered: 27 March 2001Reply With Quote
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Picture of NormanConquest
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Bill, yep, death + taxes. However remember that here in Texas you can get an over 65 exemp. + a Homestead exemp. + depending on how much land you buy you can get an ag exemp. as well.


Never mistake motion for action.
 
Posts: 17353 | Location: Austin, Texas | Registered: 11 March 2013Reply With Quote
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Picture of NormanConquest
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As to the ag exemp; you need at least 7 acres (used to be 5) + show use of ag business for the previous 5 out of 7 years. Apply every year + you will be denied very year until the 5th (needless to say to save your paperwork) at which point in the 5th year you will be granted your ag. exemp. And believe me, the difference in taxes will boggle your mind. But I'm sure the powers that be are trying to fxxk us out of that one as well. Get locked in now. Along those same lines, I have a friend who has a welding business in Stephenville, north of here ho builds barndominions , roping arenas, etc. but since Comanche County is almost all ag exempt, there is not enough tax dollars in the coffers so don't do ANYTHING that the local law can pull you over + fine you for because that is all they are after.Kyle tells me that really pisses him off so much is that he moved to this community + hired local labor + generally helped the community + now is being fined for it. Too many stories to tell about up there but no matter. Bill, its no different here than anywhere else, you just need to know how to play the game.


Never mistake motion for action.
 
Posts: 17353 | Location: Austin, Texas | Registered: 11 March 2013Reply With Quote
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Bill, an addendum. That area around Mason resembles Kenya quite a bit, the red dirt, scrub brush, etc. I met with Finn Aagaard there about 25 years ago at a local BBQ at Jim Inks ranch. Beautiful country.


Never mistake motion for action.
 
Posts: 17353 | Location: Austin, Texas | Registered: 11 March 2013Reply With Quote
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The realities are land is worth what you buy it for.

Then again what you sell it for.

Those two can vary a lot.

Sell in a up turn you make money. Minus taxes interest and any other expenses.

Buy it high and sell it in a down turn one loses money.
 
Posts: 18086 | Location: wis | Registered: 21 April 2001Reply With Quote
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Picture of Beretta682E
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quote:
Originally posted by Todd Williams:
As a custom home builder in North Texas, we've seen prices increase faster than we can keep up with.

A year and a half ago, we were a fixed price builder and a basic home could be built for roughly $135 per sq. ft, HVAC area, as long as covered porches and garages were typically sized. Today, that same home is $210 per sq. ft.

Lumber doubled between November and January. It appears to be on the way back down now however but we don't see the commodities price trends at the lumber yard for approximately 90 days.

Anyway, today, we are still not a Cost +20% builder like most companies, but rather a fixed price for our company fees (profit and overhead), but every hard cost line item is priced as an allowance based on "Today's price". If all the line items come in over the total allowance budget, the customer is responsible for paying. This after we lost more than $50K on each of 3 homes under our fixed price contracts that were written prior to the covid related price increases. When I say we lost $50K each, I don't mean we made $50K less than expected. I mean we lost every penny of our projected profit, PLUS an additional $50K out of our pockets were necessary to finish the homes!

Both of the primary banks we deal with, now insist that the customer's loan has a 10% contingency line to cover overages as they got tired, not just with our customers, but all their builder's customers, running out of money in construction and coming back for more funds before the permanent take out.

I'd say from our sales meetings and closing rates currently, we are finally seeing pushback in the market. We used to close 8 out of 10 customers that came to us. Today we are closing about 4 of 10. Several folks have stated they are just waiting to see what happens.


It’s crazy looking at home construction prices.

When I bought my house in 2009 and was built in 1h 2010 the Meritage guy begged me to buy a 5000 square foot 2 level floor plan cause they were good at building it and the cost was less than building the smallest one level house for them. He threw in high end GE appliances ect. To get me to buy a much bigger house for same $$.

With rates moving, global warming risk being built into insurance premiums in Florida and higher taxes. People will be stretching to buy much higher priced houses than a few years back.

Mike


Every man has a right to his opinion, but no man has a right to be wrong in his facts.

Bernard Baruch
 
Posts: 13108 | Location: Cocoa Beach, Florida | Registered: 22 July 2010Reply With Quote
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New sub-div going in past town on the HWY with a sign saying 'Homes starting from the 800's'. I can't understand how all these young people can afford this. The word now is that the going rate is $220.00 per sq. ft.


Never mistake motion for action.
 
Posts: 17353 | Location: Austin, Texas | Registered: 11 March 2013Reply With Quote
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Picture of Aspen Hill Adventures
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And costs keep shooting up.

Sounds like my neighbor's farm, who passed away a few months ago- the family has made a deal on the 80 acre farm. It's getting divided. Part with the 800sqft old farmhouse is going at $4500/acre. The other 40 will be sold at $5500/acre.

I am sure the other half will sell quickly. Someone will put a great big sprawling 'shouse' up smack dab in the middle of it and no doubt they will be coming from a blue state.


~Ann





 
Posts: 17614 | Location: The LOST Nation | Registered: 27 March 2001Reply With Quote
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That seems to be whats going on nation wide. Developers are buying it up with future apt. complexes in mind. Actually, Ann, those prices there are not too bad in this day + age. My son sold his 5 acres next to me for 450K. But the property values as well as the tax base around here has gone insane. I remember the past when these price escallations went through the roof; we as a nation are in for one helluva problem when this bubble bursts. And it will.


Never mistake motion for action.
 
Posts: 17353 | Location: Austin, Texas | Registered: 11 March 2013Reply With Quote
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The number of new houses I saw going up in Yuma AZ this winter is crazy.

Starting in then 3's on lots 15 foot between them.
 
Posts: 18086 | Location: wis | Registered: 21 April 2001Reply With Quote
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quote:
Originally posted by NormanConquest:
That seems to be whats going on nation wide. Developers are buying it up with future apt. complexes in mind. Actually, Ann, those prices there are not too bad in this day + age. My son sold his 5 acres next to me for 450K. But the property values as well as the tax base around here has gone insane. I remember the past when these price escallations went through the roof; we as a nation are in for one helluva problem when this bubble bursts. And it will.


This is a very rural area and it is rough country. Very little of it is tillable land. There is pretty much zero cell phone signal, no pizza delivery, it's an hour drive to a hospital. Schools are bare bones. Roads do not get plowed when it snows sometimes for a couple of days. No real services to drive up taxes.


~Ann





 
Posts: 17614 | Location: The LOST Nation | Registered: 27 March 2001Reply With Quote
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In a perfect world that would be true; but give the tax collector any excuse + he'll exploit it. A good case in point is my other 5 acres that adjoins my previous 5 is totally landlocked. There is no county easement to reach the property but they insist on taxing me full rate as if I had county services. It's an annual fight.


Never mistake motion for action.
 
Posts: 17353 | Location: Austin, Texas | Registered: 11 March 2013Reply With Quote
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quote:
Originally posted by NormanConquest:
In a perfect world that would be true; but give the tax collector any excuse + he'll exploit it. A good case in point is my other 5 acres that adjoins my previous 5 is totally landlocked. There is no county easement to reach the property but they insist on taxing me full rate as if I had county services. It's an annual fight.


And Randy, a fight you will never win. Once you get the kind of community in that is all small parcels and lots of people the strip malls come in and you end up with high taxes and all kinds of zoning laws.

I actually live in one of the most free places left in the country. I do not need permission to do anything on my property. No zoning, no permits, no inspections, no rules. I like it that way.


~Ann





 
Posts: 17614 | Location: The LOST Nation | Registered: 27 March 2001Reply With Quote
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Being an "oligarch", I'm okay with the way things are. Mortgage rates are "normal"? I would have jumped at a 5% mortgage rate most years. (The last one I have to pay off is 2.625%.).

Between 1970 and 2012, I never paid gas for my car, it was a company car. I never paid for housing costs from 1990 to 2012.

You make choices in life and have to live with them. Young people don't quite get that.

Inflation is nothing like it used to be. All we need to do is stop Putin and try to adjust to the new post-Covid normal.

I have an extended family of deadbeats. My brother tries to save them. I say, let them fail, and be a cautionary tale. You want to screw-up your life? Make a lot of bad decisions.
 
Posts: 12984 | Location: Texas | Registered: 10 May 2002Reply With Quote
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Picture of Frostbit
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We bought our first home in 1976. Interest rates were high teens. We were able to assume the existing 8.25% mortgage by selling everything we owned at that point in life to put together the large downpayment.

At closing the listing realtor and our realtor both told us how lucky we were to get that 8.25% mortgage. I still remember the quote, "You will never see interest rates that low again"

Big Grin


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Posts: 7352 | Location: Alaska | Registered: 05 February 2008Reply With Quote
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Ann I might not win but I'll be damned if I will quit fighting. I have no zoning here...yet. The permits that were county mandated was for septic systems. Now however I understand that they want permits for adding anything onto your house on your property. Once again, not out here...yet. Their solution is to tax us out of existence. Fotunately the strip mall plague has not made it this far into the country...yet. But in town it is rampant. Only 5 miles away + I read yesterday that our town has increased by 361 PER CENT!, since 2010. I can believe it. Although they have still not removed the highway population signs that say 976. Makes it so quaint that all those others want to move here, bring their ways + change what was heaven before. Aw, hell, you always knew this was a pet peeve of mine + for good reason.


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Posts: 17353 | Location: Austin, Texas | Registered: 11 March 2013Reply With Quote
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I believe there is supposed to be something like 10 billion on the planet within a few more years? I suspect the US will add at minimum 100 million very shortly. We ain't seen noth'n for urban sprawl yet.


~Ann





 
Posts: 17614 | Location: The LOST Nation | Registered: 27 March 2001Reply With Quote
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On the lower 48 road trip we do every other year we are flabbergasted at the development taking place almost everywhere we have visited in the past.


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Posts: 7352 | Location: Alaska | Registered: 05 February 2008Reply With Quote
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Interesting the property value assessments (Appraised Value) in the north Dallas area for 2022. I just received the documentation today. In Dallas County no increase proposed in property values. In Collin County they raised the max 10% on my home with all the appropriate exemptions, but 31.4% on average for investment properties. I will protest everything. (Protest deadline is May 16th.)
 
Posts: 12984 | Location: Texas | Registered: 10 May 2002Reply With Quote
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Picture of NormanConquest
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I will be too. The Williamson/ Travis county line runs right through my property. Willianson has granted me my demand for adding the other 5 acres to my homestead + over 65 exemption but Travis is refusing. We shall see once again. Bastards act like it's their money!


Never mistake motion for action.
 
Posts: 17353 | Location: Austin, Texas | Registered: 11 March 2013Reply With Quote
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quote:
Originally posted by NormanConquest:
I will be too. The Williamson/ Travis county line runs right through my property. Willianson has granted me my demand for adding the other 5 acres to my homestead + over 65 exemption but Travis is refusing. We shall see once again. Bastards act like it's their money!


I have lived in places like that. Life is too short.


~Ann





 
Posts: 17614 | Location: The LOST Nation | Registered: 27 March 2001Reply With Quote
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Picture of Beretta682E
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quote:
Originally posted by Frostbit:
On the lower 48 road trip we do every other year we are flabbergasted at the development taking place almost everywhere we have visited in the past.



We are filling a 15 year hole slowly.

https://tradingeconomics.com/u...tates/housing-starts


Mike


Every man has a right to his opinion, but no man has a right to be wrong in his facts.

Bernard Baruch
 
Posts: 13108 | Location: Cocoa Beach, Florida | Registered: 22 July 2010Reply With Quote
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Our folks died in '07 an '10. Sis and I put ten grand in fixing their place up nice so it would sell quick. In two years we had ONE offer! Finally after being low balled, then cut by a grand twice I told him to take, or we're pulling out. He took it. $78k. Four days after we closed I got sick and spent 4 months in the Hosp and NH trying to die. Cut it close.

That was 10 years ago. The other day I looked it up on Zillow. Valued at $295,000? HUH??

650s/ft place next door sold for $58K 13 years ago. Young girl bought it two years ago for $140K, she sold it last summer for $186.

We bought this run down rental for $13,750 with a 8% VA loan. Added on, built a big shop etc. It's just short of 1500s/ft now. Nearly every week I get mail wanting to buy my place. If I'd sell, then what??

In '75 I told the wife: "IF we buy this place I don't ever want to move again, IF she agrees, we'll stay here until they bag us up". We are halfway to that point now, she's been gone since Halloween '03. Just one more bag to fill and I still don't plan on moving again.

Out of 14 homes on this block. There's one 94 y/o widow and one couple about 80 left since I moved here in Sept '74. Amazing the attrition.
We have the homestead exemption. Randy take a deep breath! My taxes this year were $440. Damn the racket from all of you choking!!

George


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Posts: 5574 | Location: Pueblo, CO | Registered: 31 January 2006Reply With Quote
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One would think that with all the new house's adding to the tax base.

They would be able to lower the amount collected from each house.

But government has a unending appetite for money.

No matter how much they take in they want more.
 
Posts: 18086 | Location: wis | Registered: 21 April 2001Reply With Quote
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quote:
I actually live in one of the most free places left in the country. I do not need permission to do anything on my property. No zoning, no permits, no inspections, no rules. I like it that way.


I agree Ann zoning of the worse ideas forced onto the people of the USA.

It is amazing how many so called conservatives love it.
 
Posts: 18086 | Location: wis | Registered: 21 April 2001Reply With Quote
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